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Risk analysis in accounting information system - Essay Example

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Masters
Essay
Finance & Accounting
Pages 13 (3263 words)

Summary

Accounting information systems are a vital part of an organization's day-to-day operations.Every transaction has to be recorded in order to produce financial statements or any type of informal report that management may want to use for analysis…

Extract of sample
Risk analysis in accounting information system

Accounting information systems are a vital part of an organization's day-to-day operations.Every transaction has to be recorded in order to produce financial statements or any type of informal report that management may want to use for analysis. For this reason, accountants were some of the first people to need information systems.The advent of computer technology and the prevalence of e-business capabilities are fostering the accounting system to adapt stringent accounting practices. But organizations are still challenged with implementing new accounting Information systems with high security and unlimited reliance. Just "finding the right accounting software is a time-consuming, tedious job" (Collins, 77).AIS is a "system of collecting and processing transaction data and disseminating financial information to interested parties" (Kieso and Weygandt, 68). Factors that shape the AIS include natures of the business, the size of the firm, volume of data, and the informational demand that management and others place on the system.Krishnam, 41). Therefore, it is important that AIS produces relevant and reliable information. In AIS the basic operating functions include, tracking purchases, controlling production and inventories and payroll processing. A firm should be aware of all factors involved in implementing the Accounting Information system. Efficient AIS requires security in order to produce reliable and relevant data ...
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